IMF ready to provide funds
In February 2026, the IMF Executive Board concluded Article IV consultations with Moldova, noting the economic recovery and the implementation of a number of structural reforms.
IMF experts confirmed that Moldova had met most of the benchmarks, which opens up access to financing that can be used to support the budget and replenish international reserves, despite the fact that the previous programme was not fully implemented.
However, the question of a new financing programme remains open. According to the latest information released, the Moldovan authorities plan to submit an official request, considering various formats for the new programme. And against the backdrop of another energy crisis unfolding, the previous position of the authorities, who insisted on a new cooperation programme with the IMF without financing, may prove to be ‘outdated’.
Prime Minister Alexandru Munteanu recently confirmed that the government is awaiting the official launch of negotiations on a new agreement. According to him, ‘it will be a programme with new goals, adapted to the current priorities of the government.’
Something tells me that the government will not be able to get by with ‘moral support’ alone. Although the IMF has confirmed that it does have such a format.
IMF support, but without money
We are talking about a policy coordination tool known as the PCI programme. This is a non-lending upper credit tranche instrument designed to help countries demonstrate their commitment to a reform programme and attract financing from other sources.
The key condition for using this instrument is that economic policy measures must meet the same standards that apply to programmes supported under IMF financing agreements.
This instrument may be requested by member countries that do not need Fund financing to cover current, potential, or future balance of payments deficit financing needs from the General Resources Account or the Poverty Reduction and Growth Trust at the time of programme approval. In addition, applicants must not have any outstanding financial obligations to the IMF under previous financing programmes.
It should be noted with caution that the context of ‘current needs’ and the situation in Moldova do not fully meet the conditions of this format.
Current economic context
Following the Executive Board’s discussion of the situation in Moldova, Mr. Kenji Okamura, Deputy Managing Director of the IMF, who chaired the meeting, made the following statement:
“Moldova needs ambitious reforms to address structural challenges and sound policies to enhance resilience and maintain macroeconomic stability. The country faces long-standing challenges, including high emigration, low competitiveness, and limited institutional capacity. But there is an opportunity to overcome these challenges. It will be realised by achieving the stated policy goal of integrating into the European market and consistently continuing efforts to improve energy security, public asset management, and the fight against corruption.”
Forecasts and concerns
In the medium term, the economy will grow at a moderate pace: 2.7% in 2025 and 2.3% in 2026, ‘supported by good harvests, high domestic demand and substantial EU funding,’ the report says. Investment and reforms ‘aimed at increasing productivity’ will remain the drivers of growth.
However, the budget deficit is projected to increase to 4.8% of GDP in 2026 ‘with a significant increase in capital expenditure and some increase in current expenditure.’ The adoption of planned tax reforms should help alleviate this pressure.
According to the fund, the situation on the labour market, which remains ‘not entirely favourable’, also appears to be a significant drag. In terms of inflation, ‘the situation looks better’. The IMF is also concerned about the situation in the banking sector, the real estate market and the country’s energy security.
Strong credit growth and rapid house price increases ‘require close attention.’ The fund believes that strengthening measures to protect borrowers will help contain risks.
The IMF also urges the authorities that ‘resuming governance reforms is crucial to strengthening the business environment and protecting public resources.’
The main risks are related to ‘the war in Ukraine and other geopolitical events, as well as delays in implementing the EU Growth Plan or the misuse of the financing provided.’
IMF recommendations
These recommendations form the basis on which the terms of the memorandum will be built and which the Moldovan authorities will have to adhere to, regardless of the format of the future support programme.
The IMF emphasises the transition from crisis management to deep structural reforms. The Fund insists on the accelerated privatisation or restructuring of inefficient state-owned enterprises and the fight against corruption by strengthening the Anti-Corruption Prosecutor’s Office to investigate major financial fraud – the latter condition was one of the ‘failures’ that derailed the previous financing programme halfway through.
Particular attention is paid to the now topical issue of energy security: the IMF recommends continuing investments in cross-border electricity networks for full integration into the EU market.
The IMF has confirmed the reliability of the National Bank of Moldova.
Protecting the National Bank from political interference is considered a critical condition for long-term price stability. The Fund recommends that the National Bank itself strengthen mortgage supervision. Experts confirmed the stability of the banking system but warned of accumulating risks due to the overheating of the real estate market. It is recommended that stricter loan-to-value (LTV) limits be introduced to cool the market.
The IMF confirmed the NBM’s commitment to the principles of reliability and institutional transparency. Experts recognised the methods used as consistent with modern international practice, allowing the domestic central bank to conduct effective monetary policy and contribute to the stability of the country’s financial system.
The IMF welcomed the NBM’s prompt response to energy shocks, which brought inflation back within the target range of 5% ± 1.5%. Moldova’s banking system remains resilient despite external shocks. At the same time, the Fund stresses the importance of further strengthening macroprudential supervision, saying that mandatory bank reserve requirements remain high. Experts recommended their gradual reduction as inflationary risks ease.
The IMF stresses that maintaining adequate official foreign exchange reserves is crucial to withstand potential shocks related to energy risks amid a tense international environment, armed conflicts and energy price volatility.
The Fund recommends maintaining the flexibility of the leu exchange rate, using reserves only to smooth excessive volatility rather than to artificially maintain the exchange rate.
Risks remain significant
The IMF believes that ‘risks for Moldova remain significant’ due to its complete dependence on energy imports and geopolitics.
The war in Ukraine and other geopolitical events, including in the Transnistrian region, continue to pose downside risks due to energy shocks, euro volatility and refugee flows, according to IMF experts.
‘Vulnerability to electricity imports, given the ongoing damage to Ukraine’s energy infrastructure, transmission capacity constraints and potential capacity booking restrictions, could lead to higher import costs and tariffs,’ the report says.
For the Transnistrian region, the economic situation is deteriorating due to the unstable operation of power plants and the loss of revenue from electricity exports, which is putting pressure on economic activity and public finances.
Additional tensions may arise in trade relations, which could further reduce Moldova’s exports and economic growth. Sharp corrections in real estate prices will have negative consequences.
Risks are also associated with a possible shortfall in foreign exchange and deposit inflows, which are a key source of financing for foreign exchange reserves.
Afterword
While this material was being prepared, it became known that Moldova had initiated negotiations with the IMF on a new cooperation programme without the allocation of funds, sending a request for this format.
The reasoning remained the same. The existence of a programme with the IMF, even a non-financial one, serves as a positive signal to foreign investors and donors. The main objective of the programme is to obtain an expert assessment and confirmation of the country’s macroeconomic stability for external partners. And constant monitoring by the fund’s specialists will help to adjust economic policy.
According to Svetlana Cerovic, head of the IMF’s official representative office in Chisinau, the fund has already launched a mechanism to consider this request.
